Data breach scandals drag down telecoms’ Q3 earnings

The telecom sector is bracing for a steep drop in third-quarter earnings as the fallout from a series of cybersecurity incidents continues to weigh, with the combined operating profit of the three major telecoms — SK Telecom, KT and LG Uplus — expected to slip below the 1 trillion won ($705 million) mark. According to financial data provider FnGuide, the three carriers’ aggregate third-quarter operating profit is projected at around 829.2 billion won, a roughly 33 percent fall year-on-year from more than 1.24 trillion won. The main reason behind the slump is SK Telecom’s large-scale leak of the universal subscriber identity module (USIM) data of nearly 27 million users. Analysts warn that the company could post its first quarterly loss since it began releasing earnings, with regulatory fines, compensation payouts and customer losses from the data breach dragging down its overall performance. The company’s third-quarter revenue is estimated at about 3.94 trillion won and operating profit at 43.7 billion won, plunging 12.96 percent and 91.8 percent, respectively, from the same pe